Tech stocks weigh on S&P, Nasdaq

Losses in technology stocks dragged down the Nasdaq and the S&P 500 on Thursday, while gains in bank and energy shares propped up the Dow.

Declines in Facebook (FB.O), Microsoft (MSFT.O) and Apple (AAPL.O) pushed the Nasdaq near a two-week low, while setting the S&P 500 technology index .SPLRCT for its worst day since August.

While Wall Street has rallied since the November election on hopes that President-elect Donald Trump’s policies would be market friendly, technology stocks have barely budged, posting a mere 0.6 percent gain.

I think what you are seeing is people moving out of names that have been winners in the past couple of years and from companies that have predictable growth such as Facebook, Alphabet and Apple, said Michael Scanlon, managing director of Manulife Asset Management.

However, the Dow moved higher, powered by a more than 5 percent rise in oil prices and gains in bank stocks.

Brent futures LCOc1 hit a six-week high of $53.98. The commodity rallied nearly 9 percent on Wednesday after major oil producers agreed to cut output and support prices – the first of such a move since 2008.

The S&P 500 energy index .SPNY rose 2 percent, with shares of Exxon (XOM.N) and Chevron (CVX.N) leading the pack.

Investors are now turning their attention to economic data to assess whether the Federal Reserve could raise interest rates at its meeting on Dec. 13-14.

The central bank has been preparing the markets for a rate increase amid improving economic conditions. Some Fed officials have said President-elect Donald Trump’s policies could boost inflation, pushing it closer to the central bank’s 2 percent target.

Financial index .SPSY rose 1.65 percent on Thursday. The sector has risen more than 12 percent since the November election on prospects of an interest rate hike this month and simpler bank regulations.

Traders have currently priced in a 91 percent chance of a rate increase in December, according to Thomson Reuters data.

At 12:19 p.m. ET the Dow Jones Industrial Average .DJI was up 73.73 points, or 0.39 percent, at 19,197.31.

The S&P 500 .SPX was down 2.52 points, or 0.11 percent, at 2,196.29 and the Nasdaq Composite .IXIC was down 54.84 points, or 1.03 percent, at 5,268.84. Six of the 11 major S&P sectors were trading lower, with bond proxies such as utilities .SPLRCU and real estate .SPLRCR among the big losers.

Shares of Dollar General (DG.N) was the biggest loser on the S&P, falling 6 percent after the discount retailer reported a surprise drop in quarterly comparable sales and tempered its full-year profit forecast.

Bluebird Bio (BLUE.O) soared 16 percent to $70.25 after the gene-therapy developer said patients undergoing its multiple myeloma treatment showed strong benefits. Shares of Celgene (CELG.O), which is developing the therapy with Bluebird, was up marginally.

Skechers (SKX.N) surged 13.7 percent after Buckingham Research upgraded the shoemaker’s stock to “buy” from “neutral”.

Declining issues outnumbered advancers on the NYSE by 1,627 to 1,305. On the Nasdaq, 1,516 issues fell and 1,205 advanced.

The S&P 500 index showed 78 new 52-week highs and six new lows, while the Nasdaq recorded 148 new highs and 41 new lows.